Welendus

Invest in Short-Term Loans, Make a Great Return & Help Others

Invest in Short-Term Loans,
Make a Great Return & Help Others

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Welendus ISA
After selecting your interest rate and risk zone, your investment will be matched automatically to matching borrowers who pass our strict credit scoring and affordability checks. Your capital is at risk. No FSCS cover. Issued loans are unsecured.
 

Information about Welendus

Our sophisticated credit assessment and affordability checks allows Welendus to gain a highly accurate prediction of the borrowers’ likelihood of defaulting. We aim to achieve our target average default rate by being selective of who we accept as a borrower on our platform. In the event we see our average default rate approaching our target average default rate, we close the lending door to riskier borrowers by tightening our credit assessment and affordability criteria.
We only accept borrowers with an estimated default rate of up to 15%. However, we are targeting an average actual default rate of under 10%. We are aiming to achieve our target by maintaining the balance of high risk and low risk borrowers to be lower than the 10% target average using our comprehensive credit and affordability assessment.
Platform statistics are available for registered lenders.

Borrowers’ Creditworthiness

We do extensive checks on our borrower to verify their creditworthiness before issuing any loans. Our checks start with our internal checks, ID and background checks to filter out borrowers not meeting our lending appetite like bankrupt individuals for example. Verified applicants are then screened for fraud and money laundering (AML) which helps us keep unwanted activities off the platform. Once cleared, applicants are credit scored and their affordability is checked to determine their creditworthiness which is the final stage to determine if a borrower is approved or rejected.

Dealing with missed payments and defaults

If a borrower defaults on his/her payment, we will notify you, report the non-payment as bad debt and automatically aim to reimburse you for the principal investment lost if no repayment is made within pre-selected grace period after the due date (subject to terms and conditions). This is not a guarantee however, we aim to reimburse all our lenders for their principal losses. Subject to fund availability. All bad debt will then be followed by our internal debt collection team. If the lender is reimbursed by the provision fund then you do not have to worry about this step since the provision fund has already covered your loss. However, in the event where the provision fund was not able to pay back the lender for their loss, the internal debt collection team will reimburse the lender once the bad debt is collected.

Provision Fund

Investors using Welendus benefit from the provision fund which will aim to reimburse lenders in the event of borrower missing a payment by longer than the investor’s pre-selected grace period. This provision fund protection is not a guarantee but we aim to pay all our investors for their principal losses. See our terms and conditions for details.

Lending through Welendus

When lending through Welendus, you can choose your own return from 5% to 15% per annum. This return is the maximum you can get assuming the investment is continuously lent out with no defaults.
The interest rate you choose will determine the maximum borrower estimated default rate you will be lending to. For example, if you choose 10% return, you will be lending to borrowers with a maximum of 10% chance of defaulting. Meaning you can net 9% of return per annum when taking into account the potential defaults and the provision fund contribution and assuming your funds are continuously lent out over one year. The table below defines our estimated returns for each interest rate requested by our lenders.
We do extensive checks on our borrowers to verify their creditworthiness before issuing any loans. Our checks include credit scoring and affordability checks in addition to background checks like ID, fraud and anti-money laundering (AML). See Borrowers’ Creditworthiness (above) for more details.
The returns presented above are after deducting our fees and before tax assuming continued lending over a 12 month period. Lenders may be liable for income tax on earned interest. To check if you are liable for income tax on your earned interest please check the HMRC website or seek professional advice.
 

Thinking of leaving us?

We are sad to see you leave. But if you would like to do so, you are able to withdraw your money waiting in our lending queue any time as long as they are not lent out. If you would like to withdraw your investment which is currently lent out, you can request to withdraw from the loans linked to the investment. This process may take some time as we will have to find another lender to buy your loan. When another lender is found, you will get your principal back without any interest on the withdrawn investment.
 

Wind down plan

We are not planning to wind down and not foreseeing any reasons to wind down in the near future. However, if we are to wind down, we have a plan so it can be done smoothly and with the least effect on investments and the performance of live loans.
In the event of a wind down, first we will close the door to all new investments and return all monies waiting to be lent back to lenders. We will also stop all marketing activities and will reduce the team size to what is required to support live loans to manage the repayments as planned and without disruption. The provision fund will continue to support the bad debt during the wind down process as it would normally during normal operations. The provision fund will be the last business unit to wind down once all loan agreements are settled or terminated.
Again, this is our plan just in case we need it.

 
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